Looking for a low risk investment vehicle that is virtually stress free? Then a fixed deposit might be for you. There are plenty of fixed deposit promotions in the market, but if your motto is “local is best”, then you might be looking for the best local bank to place your savings in.
Let’s see how OCBC’s fixed deposits measure up against others.
OCBC fixed deposit rates (Nov 2019)
|OCBC fixed deposits|
|Promotional interest rate||1.55% p.a.|
OCBC fixed deposit promotions
If you’re new to the fixed deposits game, let’s just put it out there: board rates typically suck. They’re the standard, non-promotional rates offered by the banks.
But you don’t need to be too fussed with those because no matter which bank you choose, there will almost always be an ongoing fixed deposit promotion.
For OCBC, the current promotion is 1.55% p.a. for minimum $20,000 deposit for 12 months. That works out to $310 after the year. Considering you’re just parking your money there, that’s not half bad.
But while the promo rate is significantly better than the board rate (the usual rate is only 0.25% p.a.), OCBC’s fixed deposit promotion is much less attractive than that of many other banks in Singapore.
For November 2019, foreign banks like Maybank, CIMB and ICBC offer better interest rates of over 1.80% p.a. for a similar deposit.
OCBC vs Maybank and other fixed deposit promotions
As mentioned, the OCBC fixed deposit rates aren’t exactly the best in town. Assuming you are looking to deposit $20,000 for 1 year, here are some alternatives:
|Bank/financial institution||Min. deposit amount||Tenure||Promotional interest rate|
|Maybank||$20,000||12 months||1.88% p.a. (with $2,000 deposit in current/savings account)|
|ICBC||$20,000||12 months||1.85% p.a. (online only)|
|CIMB||$10,000||12 months||1.80% p.a. (online only, expires 30 Nov)|
|ICBC||$20,000||3, 6, 9 or 12 months||1.80% p.a.|
|ICBC||$500||12 months||1.75% p.a. (online only)|
|Hong Leong Finance||$20,000||12 months||1.73% p.a.|
|ICBC||$500||3, 6, 9 or 12 months||1.70% p.a.|
|CIMB||$10,000||3 or 6 months||1.70% p.a. (online only, expires 30 Nov)|
|UOB||$20,000||10 months||1.60% p.a. (expires 30 Nov)|
|Standard Chartered||$25,000||9 months||1.60% p.a. (expires 30 Nov)|
Literally almost every other bank out there has better rates, except DBS/POSB and Citibank who don’t have any SGD fixed deposit promotions.
If you’re easygoing and don’t have any preference when it comes to banks, the best rate is ICBC’s 1.85% p.a. for online applications. Maybank’s 1.88% p.a. may seem higher, but taking into account the extra $2,000 that you need to set aside, the interest earned is less.
If you die-die want to go with a local bank, UOB’s fixed deposit promotion is slightly better (1.60% p.a. for min. $20,000 deposit, 10 months tenure).
OCBC fixed deposit vs OCBC 360 savings account
So, you’ve got some cash lying around and want to get a better interest rate on it. Well, a fixed deposit with OCBC might not be the best option. In fact, the OCBC 360 savings account can actually offer better interest rates if you use it right.
With the OCBC 360 savings account, you can earn up to 1.8% bonus interest on your first $35,000. To qualify for that interest rate, you will need to credit a salary of at least $2,000 (+1.2%) every month, spend at least $500 on OCBC credit cards (+0.3%) and increase your monthly balance by $500 (+0.3%) every month. Now, remember, this is just bonus interest. You also get the base interest rate of 0.05%, bringing your interest rate to 1.85%.
If you get OCBC insurance or invest with the bank, you can also receive an additional 0.6% bonus interest, bringing your total bonus interest to a maximum of 2.4%, or a total interest rate of at least 2.45%. However, as you need at least $20,000 to do so, this option might not be available to everyone.
On your next $35,000 (ie. $35,000 to $70,000), the bonus interest rises to a maximum of 3.2% (3.25% with base interest) for crediting your salary, spending on OCBC credit cards and increasing your account balance, or up to 4.4% (3.25% with base interest) if you also insure or invest with OCBC.
These interest rates are much more attractive than what the OCBC fixed deposit can offer. So, if you can satisfy the requirements for the bonus interest, it’s a better idea to simply save money in your OCBC 360 Account than to get an OCBC fixed deposit.
Do you currently have fixed deposits in your investment portfolio? Share your recommendations in the comments!